Oregon Pension Bond Issue Under Consideration

July 11, 2003 (PLANSPONSOR.com) - Oregon lawmakers
are expected to give quick consideration to a proposal by
state Treasurer Randall Edwards to do a $2-billion bond
offering in order to pay down the state's public pension
liability.

Edwards said his proposal is expected to save $90
million over the next two years and more than $1 billion
over the long term, according to the Portland Oregonian.
The state as an employer is about $2.3 billion short of
meeting its future obligations through the Public Employees
Retirement System (PERS) despite the legislature’s already
having approved a series of cost-cutting moves at PERS.

The liability is calculated with the assumption that it
will grow by 8% a year. Pension bonds can be sold at 5%,
generating significant savings during the 24-year life of
the bonds, Edwards told the newspaper.

The House Revenue Committee approved a proposed
constitutional amendment giving the treasurer authority to
issue the bonds. The measure would go to voters in a
special election September 16. The Legislature would have
to complete action on House Joint Resolution 18 by July 18,
to give elections officials enough time to set up the
election. The House could vote on the bill as early as
Monday.

The last piece of Oregon’slegislative pension reform package – the issue of
what type of pension to provide new state and local
government employees – went to a House-Senate
conference committee this week to work out differences
between similar bills in the two chambers (See
Last Oregon PERS Reform Piece Moves to Conference
Committee
).